Are you a getting tired of reading blog after blog about, Omni-channel Customer Service, Voice Analytics, Measuring FCR, Gamification, etc.? How about if we do a little blocking and tackling for a change and look into true costs for a call center customer service agent.
As CEO of a Call Center Outsourcing company, I am often amazed at how prospective clients really don’t have a true handle on what their current cost per hour is for their customer service agents. It could be that they don’t have all of the necessary information to calculate their true cost or they just use an oversimplified estimate that results in a distorted figure that grossly underestimates their true cost.
We have put together a spreadsheet that we’d like to share with you. I believe the calculated figures within the spreadsheet take into account the vast majority of costs that need to be considered in order to define your true agent per hour cost. Yes, we could go more granular, but you can reach a point of diminishing returns, so hopefully, this spreadsheet will help you find a balance.
The spreadsheet is broken into 4 distinct categories;
- Labor Cost
- Technology Cost
- Site and other Costs
- Management Team Costs
Based on the data you input into the Assumption section, the spreadsheet will calculate the total costs within each category as well as the total combined cost.
Let’s take a look at each of these in detail.
Labor Costs – This is probably the easiest category to calculate. Enter the average hourly figure of your agents. The spreadsheet will automatically add 33% for Health insurance, workers compensation insurance, Taxes including, Federal Unemployment, Medicare/SS, State Unemployment and Vacation time. I do understand that every employee does not take healthcare, and state unemployment varies from State to State, but I believe 33% is a realistic figure for the average of your agents. If you disagree, just change the formula to the percentage you feel is appropriate.
Technology Costs – Here is a group that you will have to pry away from your IT people, but a critical component. We have allowed for two options regarding your ACD/phone System: Cloud based and Premise based. For Cloud Based, enter the per agent monthly cost. For premise based, enter the total cost of your system divided by 5 to represent the annual cost depreciated over five years. For PC software we have estimated $350 per agent amortized over 3 years. For Long Distance Fees we have assumed $100 per month per agent. For Servers and Routers, we have depreciated the total cost over 3 years.
Site and Other Costs – You will most likely have to ask your CFO/Comptroller/Owner for Rent, Utilities, Internet Access and Insurance costs. Regulatory Compliance is now something all call centers have to deal with. Enter your best estimate for the annual cost. Other expenses included copiers, printers and supplies are “catch all” categories.
Management Team Labor Cost – For Quality Assurance, we have assumed 1 Q/A employee for every 25 agents. Again, if you have a different ratio, just change the formula. Trainers are calculated at 1 for every 50 agents. Supervisors for every 15 agents. IT Support for every 50 agents. Recruiting and Interviewing is rather a difficult figure to pinpoint, so just enter an estimate. Attrition related costs, AKA, the silent killer, is calculated based on your attrition percentage and number of hours it takes to train a new agent.
This spreadsheet is not perfect, but we hope it will give you a better idea of how much it really costs to run a call center right down to the cost per agent, per hour.